OMAN'S PDO INCREASES CRUDE OIL RESERVES

Petroleum Development Oman added 327 million bbl to reserves during 1990 through exploration, appraisal drilling, and reevaluation of established fields.

The company's annual report said new reserves exceeded production by 89 million bbl. Oil reserves at the end of the year were a record 4.25 billion bbl.

With 64 fields on stream at yearend, 1990 oil production averaged a record 652,000 b/d, up from 616,000 b/d in 1989.

Nonassociated gas reserves were 7.08 tcf, and associated gas reserves were 2.83 tcf. Use of associated gas for fuel, injection, and other oil field purposes rose to 295 MMcfd from 263 MMcfd in 1989, representing about 81% of the associated gas produced '

POD installed facilities at Yibal to allow a larger volume of associated gas into the government gas system, reducing flaring in the summer when associated gas production is highest.

PDO broke new ground with discovery of very light oil in porous carbonates in 1 Al Noor in southern Oman.

In addition, the company found oil in a shallower thick interval previously believed to be shales. PDO Managing Director Henk Merle said the "shales" flowed oil at commercially promising rates and provided a lead toward potentially significant oil reserves of a new type.

PDO said the unusual strike illustrated the importance of frontier exploration in Oman, for which an aggressive strategy was formulated during the year. About 50% of future exploration effort will focus on frontier work to complement the continued hunt for reserves in better known areas.

The company's spending rose to $906.2 million from $682.7 million in 1989, Enhanced oil recovery In enhanced oil recovery, Merle said, the most promising techniques for PDO reservoirs are thermal flooding and polymer flooding, which could add 1 billion bbl of oil from reservoirs holding heavy, viscous crudes.

Pilot projects have been in operation since 1985, and PDO plans a test in Amal field of new technology that increases production in heavy oil reservoirs by electromagnetically heating the reservoir. Merle said this could provide an attractive alternative to steam soak where water is not readily available.

Construction and drilling for the eight well Amal Eastern High steam soak project started in 1990 and was scheduled to begin injection this year.

Polymer flooding in the Marmul field started with a pilot project in 1986. Polymer injection began in 1989 and resulted in a sustained increase in oil production. The company expects to expand polymer flooding to a commercial scale in 1995-96.

During 1990, PDO identified the potential for a thermal project in Qarn Alam field. It also made progress in identifying surfactants that may enhance recovery from polymer floods, which will be followed by a pilot project.

Work also started on a $500 million waterflood project in Lekhwair field, due to start up in February 1992. An infill drilling campaign has started in Yibal field based on an analysis of waterflood response since 1972 using reservoir simulation tools.

During 1990, PDO drilled 17 horizontal wells, including 10 producing wells. They were generally successful, typically yielding productivity gains of two to four times a vertical well.

PDO believes it set a horizontal well record for the Middle East with a water injection well in Yibal field that had a horizontal section of 3,384 ft.

PDO is owned by the Omani government 60%, Shell Petroleum Co. Ltd. 34%, Total Cie. des Petroles SA 4%, and Partex (Oman) Corp. 2%.